Problem w/Imov HD on New Imac

Just bought a new 24 inch Imac for video editiing and after I stopped crying about the lack of options in Imovie08 I downloaded ImovieHD06. First video I edit is fine but the newest one that has lots of short clips and photos seems to get a hiccup while getting photos from the Iphoto library.
You notice the issue when you select a photo and you get the preview screen. The picture in the window turns into a digital blob of lines and colors. It is at this point you cannot work with the movie. Ie: clips don't move right and the weird digital lines are in the storyline.
I have tried to reinstall the Imovie HD but it does the same thing. Computer works like a dream besides this so I blame the software. Anyone have a clue?? When you buy a computer to do a task and you end up stuck on that task it is very frustrating. Love the computer besides this.
btw- I moved the stuck movie on to my mac book and finished editing. It produced a great .mov file but when I used ON 2 Flix to compress to .flv it would not work. Had to save movie to mini dv disk on camera and reimport into Imovie 08. Very frustrating but it worked

I experience the same problems with the WIFI connection.
The SSID is hidden, and WEP encryption is enabled with a 128 hex key.
I can connect to it manually by entering the ssid and key.
The preferences are also saved in the system preferences on the networking prefpane.
If I start up the computer again, or set it to sleep and wake it up again, the network connection is lost (which is normal) but it never connects back, like all my other macs.
Any help with this?

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